Comprehensive review: In 2022, Shanshui Cement achieved a total operating income of 21.489 billion yuan, a year-on-year decrease of 12.86%. Net profit attributable to shareholders of listed companies was 749 million yuan, down 73.04% year on year. In 2022, although the average price of cement clinker, the company's main product, still rose slightly, the company's profits declined considerably due to the sharp rise in coal prices and the decline in product sales.
Figure 1 and 2: The revenue of Shanshui Cement declined in 2022. Significant decrease in
profit Source: Cement Big Data (https://data.ccement.com/)
Decrease in operating revenue and weaker
profit indicators In 2022, the demand of the cement industry was sluggish throughout the year, and the demand performance in the region where the Company operates was also weak. Operating income declined, but operating costs did not decline by the same margin, the decline was only 0.81%, affected by this, the company's profit indicators fell sharply. The basic earnings per share was 0.17 yuan, down 73.44% year on year, and the return on equity was 12.27 percentage points lower than last year to 3.98%. At the same time, the company's three-fee rate rose slightly, an increase of 0.72 percentage points over the same period, reaching 10.92%.
Table 1: Main Operating Data
of Shanshui Cement in 2022 Source: Cement Big Data (https://data.ccement.com/)
Downstream demand is weak, market sales decline
, the company's main operating area in Shandong, Shandong's operating income accounted for 63.3%, so the trend of the cement industry in Shandong has a greater impact on the company's operating results. In 2022, the new construction of real estate in Shandong decreased by 36.52% year-on-year, the investment completed decreased by 6%, and the downturn of real estate had a greater impact on the demand for cement. The annual output of cement in Shandong was 13405 0.08 million tons, down 18.48% year-on-year. In 2022, the company's cement clinker sales volume was 55.205 million tons, down 14% from the same period last year, and the decline in sales volume was one of the factors contributing to the company's sharp decline in profits.
Figure 3: The sales volume of Shanshui cement clinker decreased by 14%
in 2022 Data source: Cement Big Data (https://data.ccement.com/)
Coal price increased significantly The cost increased significantly
in 2022, the coal price continued to rise, the company's coal purchase price followed synchronously, the average purchase price in that year reached 1237 yuan/ton, up 20% year-on-year. At the same time, the company's clinker production coal consumption is also increasing, increasing to 122.2k G/ton, the company's clinker production cost per ton has increased significantly, reaching 151.2 yuan/ton, up 22.8% year-on-year. Although the average sales price of cement clinker of the company was 353.25 yuan/ton in 2021 due to the tail-warping factor, up 0.7% year-on-year, the increase was relatively small, which could not offset the cost increase caused by the rising coal price. The rise in coal prices has led to a significant increase in costs, which is the main reason for the sharp decline in the company's profits. Figure
4 and Figure 5: The purchase price of coal for Shanshui Cement has risen sharply. Sales price of cement clinker rises
slightly Source: Cement Big Data (https://data.ccement.com/)
Market outlook: Shandong market is not optimistic The Company's efficiency improvement is limited
Currently, the Company's main business is still the cement sector. Its revenue accounts for more than 97% of the company's total revenue. Although the company strengthens its main business, strengthens the aggregate industry chain, highlights the environmental protection sector, and promotes the development of solid and hazardous waste disposal, it is difficult to contribute significant profit growth in the short term, and the trend of the cement industry determines the company's operating results. In 2023, real estate in Shandong will continue to face downward pressure, infrastructure investment, especially transportation investment, is difficult to increase, cement demand is still under pressure, and cement prices have been falling since the beginning of the year. To sum up, it is expected that the company's operation will face greater challenges and the space for benefit improvement will be limited. (This article does not constitute investment advice)
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